Investors Defriend Social Media Shares as Facebook IPO Fizzles
That means Facebook is worth about $104 billion, more than Amazon.com, McDonalds and storied Silicon Valley icons Hewlett-Packard and Cisco. But as many people looked for a big first-day pop in Facebook’s share price, the single-digit increase was somewhat of a letdown.
“It wasn’t quite as exciting as it could have been,” said Nick Einhorn, an analyst with IPO advisory firm Renaissance Capital. “But I don’t think we should view it as a failure.”
Sam Hamadeh of PrivCo, an IPO research firm based in New York, doesn’t quite see it that way. The other day he gave us seven reasons not to buy Facebook, and he thinks today’s debut is a big fizzle. Here’s one thing he had to say:
The market was stunned that the underwriters actually had to step in with “supporting bids” to keep Facebook stock from falling below $38/share.
Will put up my interview with Hamadeh, after the market closed, shortly.
So…has the bubble popped? Tumbling badly today, these local companies:
- LinkedIn – down 6 percent
- Yelp – down 12 percent
- Pandora down 7 percent
- Zynga- down 13 percent, trading halted twice
Hamadeh says many traders used short positions on these securities as a hedge against their Facebook shares, since Facebook stock is not shortable yet.
More live coverage, from CNBC.
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